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Those who own their own home have always had an advantage when it comes to finding a personal loan. By putting their home up as collateral, they greatly lessen the risk that the loan advancer will lose out if the repayments aren't kept up with – the house can be repossessed and sold off to clear the debt. This clearly doesn't apply to renters, so what do finance companies look at when deciding whether or not to approve an unsecured finance application from a renter?

To begin with, fundamental financial information such as income and rent payments are appraised to look if the credit will be feasible. If it looks like the customer's finances will be overextended by taking on a new loan, it's unlikely to be sanctioned.

Next, the credit score of the customer is analyzed to see if they have a previous record of late payments and so on. The more negative information there is on the credit file, the harder it is to get the application granted. Conversely, if the applicant has a positive credit score with a lot of legitimate financial activity, then the chances will be increased.

If you're a homeowner, some unfavourable credit history will in all probability be ignored. What if you're a tenant with a poor credit history and can't get accepted? The only alternative might be to find someone ready to vouch for your loan. This may be a parent or other member of your family who is ready to utilise their own assets and good credit history to support your application, agreeing to take over the responsibilty of meeting repayments if you should get into trouble.

Article provided by Tenant Loans where renters of all financial backgrounds can apply for an unsecured loan.